Tesla Rethinks Battery Manufacturing Strategy As US Lures EV Makers With Incentives

Zinger Key Points
  • Tesla will now scale down battery cell production at Gigafactory Berlin-Brandenburg
  • European Commission considering providing subsidies for green-tech in line with United States

Elon Musk-led Tesla Inc. TSLA has decided to focus its cell production in the U.S., despite assembling battery systems at its Germany plant.

What Happened: In light of tax incentives under Inflation Reduction Act, or IRA, Tesla shall focus its cell production within the U.S., stated a Reuters report. U.S. President Joe Biden‘s IRA provides $374 billion in support of green-tech.

See Also: Best Electric Vehicle Stocks

Tesla will now scale down battery cell production at Gigafactory Berlin-Brandenburg, its first manufacturing location in Europe.

“The focus of Tesla’s cell production is currently in the United States due to the framework created by the United States Inflation Reduction Act (IRA),” Reuters reported, citing a Tesla spokesperson.

Why is it important: European authorities have expressed concerns that the new U.S. laws might reduce the interest of EV companies in manufacturing hubs like Germany. The European Commission is now considering providing similar subsidies for green-tech, in line with the U.S.

Tesla has long been striving to increase its own battery cell production. Last month, Tesla announced an investment of $3.6 billion for expansion of its cell factory complex in Nevada.

Read Next: Elon Musk Gives ‘Fresh’ Update On Tesla Cybertruck — But Don’t Get Excited

Market News and Data brought to you by Benzinga APIs
Comments
Loading...
Posted In: NewsTechElon MuskGigafactory BerlinInflation Reduction ActJoe Biden
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!